It’s a prospect angering many area home builders: next month newly approved impact fees in Phoenix are expected to significantly add to the cost of building a new home in Arizona’s largest city.
In a unanimous vote, members of the Phoenix City Council in April approved a proposal increasing the fees that builders pay for the construction of such things as new water and sewer infrastructure and roads, water plants, and parks.
According to city documents, “development impact fees are reviewed, and if necessary, updated every five years. These updates are necessary to ensure infrastructure plans are in line with current growth projections.”
The fees, whi
ch will vary depending upon what section of the city a new project will be built, could see a jump in north Phoenix from the current $15,578 paid for the construction of a single-family home to just under $35,000.
Phoenix officials have said that the fee increase, bringing in new revenue to the city, is needed in order to defray the cost of putting in infrastructure in areas where growth in recent years has been explosive.
But home builders have been anything but enthusiastic about the increase. In a statement, the Homebuilders Association of Central Arizona predicted that “any increase in builders’ costs will directly increase the cost to purchase a home.”
The increases, the statement added, are coming about “at a time when home buyers can least afford them, particularly in the middle of Arizona’s housing affordability crisis.”
New home building in Phoenix is partly a reflection of the city’s remarkable population growth, which is among the greatest in the country, seeing a jump from 1.3 million two decades ago to just under 1.7 million today.
May 5, 2025
By Garry Boulard
Photo courtesy of Unsplash
